MONTREAL - Canadian National Railway plans to unilaterally modify some terms of its collective agreement with Unifor after talks with the union broke down on the weekend.

CN president and CEO Claude Mongeau said in a statement Wednesday that the changes, a number of them unspecified but including a two per cent wage increase, will be implemented Friday.

The railway says a key stumbling block has been what he says is Unifor's refusal to back down on a proposal that the company contribute cash to the union’s political and community action fund.

"CN is prepared to co-invest in charitable causes, but we are not prepared to support such a union agenda," Mongeau said.

However, Unifor president Jerry Dias accused the railway of misrepresenting the union's Canadian Community Fund, which calls for a company contribution of five cents per hour per union member.

Dias said the union established a pattern at CP Rail when Unifor reached a tentative agreement Saturday, including the new fund.

"CP understood the value of this fund, it's unfortunate that CN does not see this opportunity," Dias said.

Unifor represents approximately 4,800 CN employees.

It has scheduled news conference for Thursday to discuss the impasse and how the union plans to proceed.

CN said the changes it has decided to impose will help improve service and efficiency.

The company's last offer on Sunday, rejected by Unifor, called for a three-year agreement with three per cent wage increases in each year.

It also contained benefit improvements the company said were in line with what it negotiated recently with the United Steelworkers, which represents 3,000 maintenance-of-way employees; as well as the 1,800-member Teamsters Canada locomotive engineers and the 180-member Teamsters Canada-Rail Canada Traffic Controllers.